Are online + eBook retailers killing small bookshops?

Darryl Adams is a government worker and internet tragic. A former IT worker, he still pines for the days of IBM keyboards that go CRUNCH and the glow of green screens. He can be found on on Twitter or on Facebook. Check out his site oz-e-books.com for more articles about e-book readers, retailers, formats and news (or will have when Darryl can be drawn away from reading Delimiter). The views expressed here do not reflect the views of his employer, the ATO.

To be honest, I was shocked at the negative information I was getting from Tim about his business, which is a major player in the SFF book scene and has been around since 1991.

I ended up asking him to tell me how many books I have bought recently. This was easy as Tim runs a loyalty programme. Two times a year, for each $150 people spend at the store, each customer gets a $10 voucher. I have managed up to 4 vouchers for a 6 month period, and I was a bit shocked that I was still below the first $150 threshold. And that was with a $50 hardcover I was picking up this time.

Are eBooks part of the problem? I would have to say yes. I am still buying books, and willing to buy hardcovers, but I am more choosy in what I buy. That is not to say I solely read eBooks, and some of the eBooks had me also go out and buy the dead tree edition of the books (The Mercedes Lackey, Eric Flint and Dave Freer Heirs of Alexandria series being the latest series I have paid for in eBook, Electronic Advanced Reader Copy and the paper version. Yes I am strange).

However, I have been less willing to purchase books in the traditional paper version unless I have read at least one of an authors works in eBook format.

But the market is changing in other ways too. Local publishing houses don’t care about the little stores. One anecdote Tim told us was that he had ordered from the local publisher a particular media tie-in book. When it failed to arrive, Tim called and found out the books were re-routed to a large retail chain. However, the books where on back order and Tim was still required to purchase the books, even though the sales had disappeared (why wait when you can go to K-Mart?).

Online sellers are not helping either. When Book Depository can ship a book free to Australia from the UK, and at a steep discount to the local price, even booksellers would have to question why they should source the book locally when they can pull out a credit card and order it from the UK.

And the local price is high. One anecdote Tim told me about local and imported books from the USA. I have decided not to write about it as it may bring distributor pressure, and the last thing I want to do is cause more grief for Tim, despite the fact parallel importing is totally legal.

In addition, despite my opinion and the prevailing political belief that the economy has recovered, sales of books have dropped considerably. Tim has reduced staff and working hours in order to survive, and even he fears that his actions may not be enough. Other specialist book stores around Sydney have closed in the last couple of years, and large chains like Barnes and Noble are suffering in the US (the company recently announced it was going on the market).

Between the instant gratification of buying eBooks, overseas companies being able to sell books cheaper than in Australia, bone-headed Australian publishers and the economy, are we all forming an axis of evil against local book retail? I am a fan of Infinitas and have been a long term buyer there. However, I may be also part of the forces trying to kill it. And that, I find, is disturbing.

14 COMMENTS

Just down the road from where I work is a no-name discount bookseller who’s selling classics, e.g. Jane Austen, for $6.95. That’s about as cheap as books get in Australia. I can buy exactly the same book on-line for $4, with free shipping. My son wanted “High Fidelity” which was $29 at Angus & Robertson – I bought it on-line for $10.50. I’d be insane to buy at a real book shop. I love books, but book shops are dead.

I was a loyal customer of both my local store and Galaxy books. I rarely shop at either any more, and the factor in this wasn’t eBooks but The Book Depository. My parochialism could only last so long againsy heavily discounted books shipped for free. Everyone I know who is a book lover buys their products there.
I was really disappointed when the government ignored the productivity comissions recommendations, bowed to lobby pressure from the local industry and rejected allowing parallel imports. The local music industry didn’t collapse – why would the bookk industry?

If money is all that matters to them, that is keeping prices high on mostly foreign product – why shouldn’t we just buy the foreign product directly and save lots of money? Certainly the economically rational, capitalist and conservative thing to do.

There’s certainly no chance I buy any new dead tree books in Australia ever again thanks to attitudes like that.

Have to offer a correction here – its often reported that Book Depository heavily discounts off the UK retail price. As far as I can establish, in most cases, its around 10-12% at the most. Discounts are higher on lead titles, but Book Depository would be negotiating high discount from publishers on those plus willing to use them as loss leaders, they’re not doing anything particularly different from Oz based chains.

What is different is the wholesaling arrangements that UK retailers, high street or online, can access whilst their Aust equivalents are largely forced to use distribution models that are both wildly inefficient and effectively tariff protected via PIRs. The wholesale price that a UK bookseller may pay for a book (and this is almost always true of academic titles) is lower than the Australian distributor will pay the originating publisher in the UK for the same book. Then shipping, fees, warehousing and re-selling the book has to be added – bingo! – much much higher wholesale prices in the Aust market.

Being a damned long way from anywhere else has helped to keep online resellers at bay – until Book Depository’s model came along – but they are not heavily discounting. They are selling out of a market that has lower book prices because of stronger competitive pressures and more efficient distribution models. And as for the general 10% or so discount – they dont have shopfronts, making their overheads much lower than a bricks and mortar bookseller.

If Aust distributors and the Aust booksellers forced to depend upon them want to survive they need to adopt the use of POD instead of demanding the retention of tariffs – inefficiency will kill Aust distribution and bookselling, not the Book Depository.

Australian distributers are owned by Australian publishers. There is a strong business model to be ineficiant here.

In the US, this is not the case, and you can parraelle import a book here and still be cheaper than the aussie distributer, including air postage GST on the final sale.

Book Depository has the advatage that Royal Mail is better by far than the US Mail, and that Australia Post is up there as well. Still, when I can by an Aussie author’s book for less than $9 with free postage, something is rotten in Denmark…..

Australian distributors may be owned by Australian Publisher (or their UK parent), but distribution on international titles is their main business, simply because the local publishing business is not big enough.
Bernice is right, Australian distributors are buying at the same or slightly better price as UK wholesalers. Shipping is a major cost and of course warehousing, and then offering Sale or Return terms to Australian retailers.
Additionally part of the argument of maintaining copyright in our own territory is that Australian authors’ incomes remian protected. Selling rights is a big part of an authors income, and if you can’t sell rights in your own country, where do you start?

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